Wednesday, 22 June 2016

Does a skills gap exist?

Employers the world over are talking about the shallowness of the talent pool, and the difficulty in obtaining people with good technical science, math, engineering and technology (STEM) AND 'soft' skills.

Those 'soft' skills are things like problem-solving, teamwork and communication, and employers seem to regularly comment in the media on the tertiary sector's inability to build, hone and transfer those 'soft' skills into graduates.

In February 2016, Canadian HR journalist, Claudine Kapel, wrote about some new research which appears to suggest that the driver behind the 'skills gap' that employers speak of is actually a function of a low-wage economy.

Not a lack of graduate preparedness.

Claudine reported that it was possible that "the real culprit behind skill gaps is organizations are unwilling to pay what is needed to recruit and retain such talent". She went on to cite Thijs van Rens, an associate economics professor from the University of Warwick and writer of "The Skills Gap: Is It a Myth?” who said “It is often taken for granted that the skills gap and skills mismatch is a supply problem and appropriate training is not available to workers” (February 2016).

To find evidence of a sector or state gap with skills, Thijs looked at hard data on US job seeking and unemployment since 1979. He found that the US “data shows that market wages do not reflect the relative demand for different types of skills, [and is] not due to problems with the education system, but to employers being unwilling to offer higher wages to suitably skilled workers”, finding that "that wages do not adjust in response to differences between demand and supply of skills" (Kapel, February 2016).

So we can educate people all we like, but that won't (a) attract people into professions where they are not rewarded for the skills they have obtained, or (b) encourage people to obtain skills which the labour market won't pay for.

Education reform won’t fix this 'gap'. Thijs states that “As long as wages do not reward certain skills, workers will be less likely to acquire them, [or, if they do acquire them, they will] find employment in higher-paid occupations" in order to get the reward they seek for their skill set. Thijs found that a lot of STEM graduates - engineers, scientists and physicists - went into finance, because the pay for their skill set was better (Kapel, February 2016).

Now there's a clear driver for using data to drive research, not WAGs (Wild Arsed Guesses) by a sector which,
to quote Thijs, may well "be inspired by self-interest rather than a thorough analysis of the problem" (Kapel, February 2016).


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